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The real impact of corporate governance isn't about compliance or structure or policies, it's about the conditions that impact decision-making. Sound-Up Governance features fresh perspectives to help boards and executives to be a bit better tomorrow than they were yesterday.
Independence is a much bigger deal in a group of people who work together than it is for someone who works on their own. When you started Reallie Steilish and were the only shareholder, the only employee, and the only director, there was no conflict of interest among shareholders, employees, and the board because your interests are aligned with…your interests. The moment you add even one more person to the mix, there’s a potential for conflict of interest, no matter what role that person plays. And when you have a bigger group of people who work together, the conflicts can get way more complicated and conflict-y.
Another completely different weird thing happens when groups of people work together. Let’s say Reallie Steilish has five employees and one of them, Onson Sweemey, comes to work one day and is SUUUUPER excited about his cross branding idea: selling Reallie Steilish trucker hats with the OliveYeah Rodrigoil logo on them. His excitement is so infectious that the whole team – including you – decide to get started on it right away. The fact that you all got excited and didn’t even bother wondering if Onson’s idea was really that great after all is an example of something called “group think.”
Anyway, most people think group think is bad and only use the term when they’re describing situations where things turned out badly. Imagine any group of people – a family, sports team, BTS, etc. – and it wouldn’t seem far fetched for that group to jump to a half-baked conclusion because they like each other, or they’re busy, or they just don’t think it’s a big deal. And they might be COMPLETELY wrong sometimes. It happens!
Let’s say your uncle Karl Dandleton is coming to visit for the first time in 10 years and he lives really far away. Everyone in your family is excited to see him and you want to surprise him by taking him to everyone’s favourite restaurant in town: Piles o’ Pastrami. When you get there, you find out that uncle Karl Dandleton HATES pastrami – always has, and always will. You never knew! But you *would* have known if you’d just asked Karl’s husband, uncle Dan Dandleton, or your cousin (Karl & Dan’s son) Darl, or anybody else who spends time with Karl. You really messed this one up thanks to group think.
On the other hand, Onson Sweemey’s cross-branding idea might have been a low-risk, high-reward opportunity that would have just gotten unnecessarily bogged down, or even scrapped altogether, if your team had decided to examine it from all angles before jumping on board. Sometimes group think can be energizing, efficient, and excellent. That’s the funny thing about group think: sometimes it’s kinda awesome.
What causes people to believe group think is always bad? Group think! They usually only think it’s bad because that’s what everyone else thinks, too.